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As the wars in Afghanistan and Iraq drag on, the growing costs of the war over the last seven years have impacted the current economic downturn in the U.S. economy, said Sen. Ben Nelson, D-Neb.
"There's no question that adding to the national debt to the tune of more than $500 billion, and soon to be $600 billion and perhaps more, has had an impact," Nelson said.
He said those amounts are emergency supplementals that are not budgeted and have to be paid for through borrowed money that adds to the federal debt. While those amounts are not budgeted, taxpayers have to pay the ever-increasing amount of interest on those loans as part of the budget before money can be allocated for domestic programs.
The Congressional Budget Office is estimating the war will cost $1.7 trillion to $2.7 trillion and the Joint Economic Committee says it will cost $3.5 trillion.
According to an article in the Washington Post, Nobel Prize-winning economist Joseph Stiglitz blames the economic recession on the war.
Stiglitz said that government spending on the Iraq war has caused the country to sink so far into debt that it has been unable to keep the domestic economy in check through tax cuts and other internal investments.
The national debt is now at $9.4 trillion and has continued to increase by an average of $1.67 billion per day since Sept. 29, 2006.
Earlier this month, Nelson said, future taxpayer dollars provided for Iraq reconstruction should be structured in the form of a loan to the Iraqi government.
"The blank check policy must end and the Iraqis need to invest really invest in their own future by repaying the United States for future reconstruction funds," Nelson said.
With oil prices at $114 per barrel, Nelson said, Iraq is expected to have record surpluses in government revenue of about $60 billion.
"Here at home we have a spiraling deficit, crumbling infrastructure and shortfalls in funding for our national defense," Nelson said. "I believe that it is time to push to end the cycle of dependence and end the era of blank checks for Iraq. The American people are growing weary of financing every aspect of Iraq's resurgence."
Also, Nelson said, squeezing domestic programs is an ever-increasing military budget.
"There's no doubt that when the money is added to the debt, it affects the credit rating of the United States, it affects the ability of Congress to be able to fund local projects and take care of local needs, with infrastructure being one of them, and other obligations," Nelson said.
Nelson said that's one of the reasons Iraq must begin to shoulder more of the burden of the cost of its civil war.
"We must expedite the ability of Iraq to stand on its own two feet," he said.
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